08 February 2013

Developers who have been cutting
prices following the new cooling measures risk angering buyers who bought at
the earlier levels, say experts.

But developers claim that the recent
discounting does not necessarily disadvantage early buyers.

Property experts say some buyers who
have just shelled out on a new home will inevitably be unhappy when they see
units at the same development suddenly going cheaper.

An industry player, who declined to
be named, said price cuts are a sensitive issue and unhappiness with the
developer can be expected with some buyers "banging tables".

When asked if earlier buyers had
expressed unhappiness at the discounts, A CapitaLand spokesman told The Straits
Times: "Our buyers, in general, are aware that we consider the prevailing
market conditions and offerings at other developments within the same area when
coming up with promotional schemes.

"In fact, some buyers who
purchased units earlier enjoyed more attractive pricing despite the current
promotional discounts." He pointed out that these buyers also paid lower
stamp duties and had higher loan quantums so once these factors are taken into
consideration, it would not be meaningful to compare prices of units bought at
different times.

Another developer, who declined to be
named, said the firm explains to earlier buyers that the price premium they
might have paid is due to the choicer units being offered to them at the
earlier launch date.

Even with discounts, prices rarely
fall below the launch level, he added, as prices are typically inched up
gradually as the project sells more units.

The way industrial land is zoned
should be re-assessed to ensure small and medium-sized enterprises (SMEs) will
be able to grow, according to a property consultancy.

The firm, responding to the
Government's White Paper on Population, said there is a risk some firms will be
left out in the cold by existing zoning categories. These were devised for a
manufacturing sector that is rapidly evolving - and in turn, threatening to
leave these zoning definitions looking outmoded.

Much of the traditional assembly and
production activity has gone offshore. But the newer enterprises often do not
know if their activities - often they involve creative work or other
design-related activity - run foul of zoning laws.

There are three types of users under
the Business 1 (B1) zoning for industrial property.

There are product manufacturers, for
whom the zoning was initially devised. But there are also firms which are not
authorised to use industrial space, such as tuition and employment agencies.

And increasingly there is a
"grey area". For example, local SMEs are often subcontractors for
multinational companies, specialising in a few aspects of the larger firm's
production process. These should be allowed to use industrial space, which is
cheaper than office space, even if their activities do not resemble traditional
manufacturing.

If the Government does not adapt B1
definitions to meet the realities of modern manufacturing, then one alternative
could be to create a new supply of basic, no-frills office space in non-central
locations.

Another option would be to create a
hybrid industrial-office, a land-use category used by firms in Hong Kong which
need a local administrative base to coordinate factories in China.

The consultancy also called for more
clarity, sooner rather than later, to ensure that the "manufacturing
sector and Singapore will be better able to keep abreast of global
competition".